Arizona Medicaid Cuts Slice Into Vanguard Earnings

Gov. Jan Brewer says Arizona will expand its Medicaid program. Vanguard and other healthcare companies pressed the state to take part in the expansion. Photo Credit/Gage Skidmore, Wikimedia Commons

Profits are down nearly 20 percent at Nashville-based Vanguard Health. Executives say deep cuts to Medicaid in Arizona are to blame, but the Medicaid expansion offered by the federal government could help turn things around.

Vanguard owns hospitals nationwide. In Arizona, it administers one of the health plans available to Medicaid recipients. But since 2011, state lawmakers have cut the program by more than half a billion
dollars, which means health care providers are getting paid less to treat Medicaid patients. Phil Roe is Vanguard’s Chief Financial Officer.

“While we have been able to partially offset that impact with results in other markets, the financial results in Arizona have been challenging.”

That’s why Vanguard and other healthcare companies lobbied hard for the state to take part in the Medicaid expansion offered under the Affordable Care Act. Republican Governor Jan Brewer announced last week that Arizona will participate. It’s expected to bring about $8 billion into the state’s coffers. Vanguard says the federal money will help reverse the cuts Arizona has made to Medicaid over the last two years.